Naira yesterday eased against the US dollar losing 0.2 percent or N0.30k at the Nigerian Interbank Foreign Exchange (NIFEX) market, defying the Central Bank of Nigeria (CBN)’s foreign exchange policy.
The local currency yesterday closed at N162.80/$ as against N162.50/$ traded the previous day, data from Financial Markets Dealers Quotations (FMDQ) have revealed.
Analysts have said the naira depreciation was as a result of increased demand for the greenback by end users.
The spreads between the official foreign exchange rate and the alternative market rates narrowed in the past week following the removal of USD250,000.00 limit on autonomous funds sales to the Bureau De Change (BDC) and the parallel market operators by the CBN.
Samir Gadio, an emerging-markets strategist in London at Standard Bank Group Limited was quoted by Bloomberg as he said the removal of the cap on foreign-exchange sales by banks to bureaux de changes will also bring an extra layer of foreign-exchange demand.
However the CBN on Monday offered a total of $400 million but sold a total of $399.9 million to 18 deposit money banks at N155.75/$ at its twice weekly Retail Dutch Action System (RDAS) window.
On the other hand, Nigeria’s foreign-exchange reserves have fallen 12 percent since last year’s peak in May to $42.98 billion as of Jan. 31, the lowest level since November 9, 2012 according to Bloomberg report.
The CBN is concerned that a widening gap between interbank and bureaux de change rates may precipitate speculation, Sanusi Lamido Sanusi, CBN governor said last month.
Sanusi, who will step down in June after his term expires, has blamed falling reserves on crude revenue “leakages” and the state oil company’s retention of $10.8 billion that he says should have been transferred to government accounts.
The Apex bank last month at the Monetary Policy Committee (MPC) raised the cash-reserve requirement on public sector funds to 75 percent from 50 percent and kept its benchmark interest rate at a record high 12 percent to keep the naira stable and curb inflation ahead of elections next year.
By: HOPE MOSES-ASHIKE
